Readers' forum : Busted

I act for a partnership of three individuals who jointly own a portfolio of investment properties one of which is a commercial building bought as a going concern in 2010 from a plc. The new owners continue to rent out the building and continue to charge VAT on the rents.

However because they opted to tax immediately before they bought the building they were not charged VAT on the purchase.

Subsequently it appears that one of the three partners is to be declared bankrupt. It has been agreed with the trustee in bankruptcy that the remaining two partners will take on the building and the attendant borrowings secured against it and will continue with the VAT registration in their own names. The building is not within the scope of the capital goods scheme.

Does a new option to tax have to be filed on the basis that this...